Gold prices fell more than 1% for the week. On Friday, spot gold slipped 1.63% to $1,578.11 an ounce. Gold futures for delivery in August on the Comex division of the New York Mercantile Exchange settled $30.50 lower at $1,578.90 an ounce.
The precious Yellow metal was higher for most of the week, but turned Thursday when the EUR came under pressure following rate cuts by the European Central Bank and dovish comments from ECB President Mario Draghi saying economic growth remains “weak.”
Bullion slipped after the Labor Department reported that the U.S. economy added 80,000 jobs in the month of June, well short of economists’ expectations. The unemployment rate remained at 8.2%.
Gold prices have also come under pressure due to little support for the precious metal from the physical market. Demand for gold in the physical market has remained subdued. Data showed that Hong Kong shipped 75,456 kg of gold to mainland China back in May, representing a decline of 26% over the previous month.
Gold may be on the defensive next week as continued debt worries and economic weakness in Europe undermine the EUR and lead to strength in the USD
Kitco News Gold Survey next week july 9-13 2012
In the Kitco News Gold Survey, out of 34 participants, 20 responded this week. Of these, 11 participants see prices down, while 7 see prices up and 2 see prices sideways or unchanged. Market participants include bullion dealers, investment banks, futures traders and technical-chart analysts.
One of the most-cited reasons for more near-term weakness was expectations for continued gains in the U.S. dollar, although some also cited the technical-chart picture. Unless the Fed releases a magic bullet sooner than later, I would expect the US$ to remain well bid next week, which will be negative for the metals,
Those who look for gold to rise next week cite ideas that the market will continue to look for more stimulus from the world’s central banks, as well as continued current negative interest rates in key economies such as the U.S. One also notes gold soon may start picking up ahead of the seasonally strong period that tends to start in late summer and early autumn.
Bloomberg survey gold next week july 9-13 2012
18 of 27 traders and analysts surveyed by Bloomberg expect gold to climb next week and three were neutral. Futures on the Comex exchange in New York are up 1.4 percent since the start of January at $1,588.10 an ounce. Holdings in bullion-backed exchange-traded products reached a record 2,413.6 tons July 5, data compiled by Bloomberg show.
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